SB0117 95TH GENERAL ASSEMBLY

LRB095 04965 BDD 25031 b

95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
SB0117

Introduced 1/31/2007, by Sen. John J. Cullerton

SYNOPSIS AS INTRODUCED:

35 ILCS 505/2b	from Ch. 120, par. 418b
35 ILCS 505/6	from Ch. 120, par. 422
35 ILCS 505/6a	from Ch. 120, par. 422a
415 ILCS 125/315

Amends the Motor Fuel Tax Law and the Environmental Impact Fee Law. Requires certain taxpayers and receivers under the Acts to file monthly returns with the Department of Revenue and to make quarter-monthly payments. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Motor Fuel Tax Law is amended by changing Sections 2b, 6, and 6a as follows:

(35 ILCS 505/2b) (from Ch. 120, par. 418b)

Sec. 2b. In addition to the tax collection and reporting responsibilities imposed elsewhere in this Act, except as otherwise provided in this Section, a person who is required to pay the tax imposed by Section 2a of this Act shall pay the tax to the Department by return showing all fuel purchased, acquired or received and sold, distributed or used during the preceding calendar month including losses of fuel as the result of evaporation or shrinkage due to temperature variations, and such other reasonable information as the Department may require. Losses of fuel as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of the month, plus the receipts of gallonage during the month, minus the gallonage remaining in storage at the end of the month. Any loss reported that is in excess of this amount shall be subject to the tax imposed by Section 2a of this Law. On and after July 1, 2001, for each 6-month period January through June, net losses of fuel (for each category of fuel that is required to be reported on a return) as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of each January, plus the receipts of gallonage each January through June, minus the gallonage remaining in storage at the end of each June. On and after July 1, 2001, for each 6-month period July through December, net losses of fuel (for each category of fuel that is required to be reported on a return) as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of each July, plus the receipts of gallonage each July through December, minus the gallonage remaining in storage at the end of each December. Any net loss reported that is in excess of this amount shall be subject to the tax imposed by Section 2a of this Law. For purposes of this Section, "net loss" means the number of gallons gained through temperature variations minus the number of gallons lost through temperature variations or evaporation for each of the respective 6-month periods.

The return shall be prescribed by the Department and shall be filed between the 1st and 20th days of each calendar month. The Department may, in its discretion, combine the returns filed under this Section, Section 5, and Section 5a of this Act. The return must be accompanied by appropriate computer-generated magnetic media supporting schedule data in the format required by the Department, unless, as provided by rule, the Department grants an exception upon petition of a taxpayer. If the return is filed timely, the seller shall take a discount of 2% through June 30, 2003 and 1.75% thereafter which is allowed to reimburse the seller for the expenses incurred in keeping records, preparing and filing returns, collecting and remitting the tax and supplying data to the Department on request. Except as otherwise provided in this Section, the The discount, however, shall be applicable only to the amount of payment which accompanies a return that is filed timely in accordance with this Section.

On and after July 1, 2007, if the taxpayer's average monthly liability to the Department for the aggregate of the tax imposed under Section 2a of this Law and the fee imposed under Section 315 of the Environmental Impact Fee Law was $20,000 or more during the preceding 4 complete calendar quarters, then the taxpayer shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payments to the Department on or before the 7th, 15th, 22nd, and last day of the month during which such liability is incurred. Each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of the quarter-monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section. Once applicable, the requirement of the making of quarter-monthly payments to the Department by taxpayers having an average monthly tax liability of $20,000 or more as determined in the manner provided above, shall continue until the taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until the taxpayer's average monthly liability to the Department, as computed for each calendar quarter of the 4 preceding complete calendar quarter period, is less than $20,000. If, however, a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred that causes the taxpayer to anticipate that his or her average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then the taxpayer may petition the Department for a change in the taxpayer's reporting status. The Department shall change the taxpayer's reporting status unless it finds that the change is seasonal in nature and not likely to be long-term. If any quarter-monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer is liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of the quarter-monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter-monthly payment amount and quarter-monthly payment dates for taxpayers who file on other than a calendar monthly basis.

(Source: P.A. 92-30, eff. 7-1-01; 93-32, eff. 6-20-03.)

(35 ILCS 505/6) (from Ch. 120, par. 422)

Sec. 6. Collection of tax; distributors. A distributor who sells or distributes any motor fuel, which he is required by Section 5 to report to the Department when filing a return, shall (except as hereinafter provided) collect at the time of such sale and distribution, the amount of tax imposed under this Act on all such motor fuel sold and distributed, and, except as otherwise provided in this Section, at the time of making a return, the distributor shall pay to the Department the amount so collected less a discount of 2% through June 30, 2003 and 1.75% thereafter which is allowed to reimburse the distributor for the expenses incurred in keeping records, preparing and filing returns, collecting and remitting the tax and supplying data to the Department on request, and shall also pay to the Department an amount equal to the amount that would be collectible as a tax in the event of a sale thereof on all such motor fuel used by said distributor during the period covered by the return. However, no payment shall be made based upon dyed diesel fuel used by the distributor for non-highway purposes. Except as otherwise provided in this Section, the The discount shall only be applicable to the amount of tax payment which accompanies a return which is filed timely in accordance with Section 5 of this Act. In each subsequent sale of motor fuel on which the amount of tax imposed under this Act has been collected as provided in this Section, the amount so collected shall be added to the selling price, so that the amount of tax is paid ultimately by the user of the motor fuel. However, no collection or payment shall be made in the case of the sale or use of any motor fuel to the extent to which such sale or use of motor fuel may not, under the constitution and statutes of the United States, be made the subject of taxation by this State. A person whose license to act as a distributor of fuel has been revoked shall, at the time of making a return, also pay to the Department an amount equal to the amount that would be collectible as a tax in the event of a sale thereof on all motor fuel, which he is required by the second paragraph of Section 5 to report to the Department in making a return, and which he had on hand on the date on which the license was revoked, and with respect to which no tax had been previously paid under this Act.

On and after July 1, 2007, if the taxpayer's average monthly tax liability to the Department for the tax imposed under Section 2 of this Law was $20,000 or more during the preceding 4 complete calendar quarters, then the taxpayer shall file a return with the Department each month in accordance with Section 5 of this Law and shall make payments to the Department on or before the 7th, 15th, 22nd, and last day of the month during which the liability is incurred. Each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of the quarter-monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section. Once applicable, the requirement of the making of quarter-monthly payments to the Department by taxpayers having an average monthly tax liability of $20,000 or more, as determined in the manner provided above, shall continue until the taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until the taxpayer's average monthly liability to the Department, as computed for each calendar quarter of the 4 preceding complete calendar quarter period, is less than $20,000. If, however, a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred that causes the taxpayer to anticipate that his or her average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then the taxpayer may petition the Department for a change in the taxpayer's reporting status. The Department shall change the taxpayer's reporting status unless it finds that the change is seasonal in nature and not likely to be long-term. If any quarter-monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer is liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of the quarter-monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter-monthly payment amount and quarter-monthly payment dates for taxpayers who file on other than a calendar monthly basis.

A distributor may make tax free sales of motor fuel, with respect to which he is otherwise required to collect the tax, when the motor fuel is delivered from a dispensing facility that has withdrawal facilities capable of dispensing motor fuel into the fuel supply tanks of motor vehicles only as specified in the following items 3, 4, and 5. A distributor may make tax-free sales of motor fuel, with respect to which he is otherwise required to collect the tax, when the motor fuel is delivered from other facilities only as specified in the following items 1 through 7.

1. When the sale is made to a person holding a valid unrevoked license as a distributor, by making a specific notation thereof on invoices or sales slip covering each sale.

2. When the sale is made with delivery to a purchaser outside of this State.

3. When the sale is made to the Federal Government or its instrumentalities.

4. When the sale is made to a municipal corporation owning and operating a local transportation system for public service in this State when an official certificate of exemption is obtained in lieu of the tax.

5. When the sale is made to a privately owned public utility owning and operating 2 axle vehicles designed and used for transporting more than 7 passengers, which vehicles are used as common carriers in general transportation of passengers, are not devoted to any specialized purpose and are operated entirely within the territorial limits of a single municipality or of any group of contiguous municipalities, or in a close radius thereof, and the operations of which are subject to the regulations of the Illinois Commerce Commission, when an official certificate of exemption is obtained in lieu of the tax.

6. When a sale of special fuel is made to a person holding a valid, unrevoked license as a supplier, by making a specific notation thereof on the invoice or sales slip covering each such sale.

7. When a sale of special fuel is made to someone other than a licensed distributor or a licensed supplier for a use other than in motor vehicles, by making a specific notation thereof on the invoice or sales slip covering such sale and obtaining such supporting documentation as may be required by the Department. The distributor shall obtain and keep the supporting documentation in such form as the Department may require by rule.

8. (Blank).

All special fuel sold or used for non-highway purposes must have a dye added in accordance with Section 4d of this Law.

All suits or other proceedings brought for the purpose of recovering any taxes, interest or penalties due the State of Illinois under this Act may be maintained in the name of the Department.

(Source: P.A. 93-32, eff. 6-20-03.)

(35 ILCS 505/6a) (from Ch. 120, par. 422a)

Sec. 6a. Collection of tax; suppliers. A supplier, other than a licensed distributor, who sells or distributes any special fuel, which he is required by Section 5a to report to the Department when filing a return, shall (except as hereinafter provided) collect at the time of such sale and distribution, the amount of tax imposed under this Act on all such special fuel sold and distributed, and, except as otherwise provided in this Section, at the time of making a return, the supplier shall pay to the Department the amount so collected less a discount of 2% through June 30, 2003 and 1.75% thereafter which is allowed to reimburse the supplier for the expenses incurred in keeping records, preparing and filing returns, collecting and remitting the tax and supplying data to the Department on request, and shall also pay to the Department an amount equal to the amount that would be collectible as a tax in the event of a sale thereof on all such special fuel used by said supplier during the period covered by the return. However, no payment shall be made based upon dyed diesel fuel used by said supplier for non-highway purposes. Except as otherwise provided in this Section, the The discount shall only be applicable to the amount of tax payment which accompanies a return which is filed timely in accordance with Section 5(a) of this Act. In each subsequent sale of special fuel on which the amount of tax imposed under this Act has been collected as provided in this Section, the amount so collected shall be added to the selling price, so that the amount of tax is paid ultimately by the user of the special fuel. However, no collection or payment shall be made in the case of the sale or use of any special fuel to the extent to which such sale or use of motor fuel may not, under the Constitution and statutes of the United States, be made the subject of taxation by this State.

A person whose license to act as supplier of special fuel has been revoked shall, at the time of making a return, also pay to the Department an amount equal to the amount that would be collectible as a tax in the event of a sale thereof on all special fuel, which he is required by the 1st paragraph of Section 5a to report to the Department in making a return.

On and after July 1, 2007, if the taxpayer's average monthly tax liability to the Department for the tax imposed under Section 2 of this Law was $20,000 or more during the preceding 4 complete calendar quarters, then the taxpayer shall file a return with the Department each month in accordance with Section 5 of this Law and shall make payments to the Department on or before the 7th, 15th, 22nd, and last day of the month during which the liability is incurred. Each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of the quarter-monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section. Once applicable, the requirement of the making of quarter-monthly payments to the Department by taxpayers having an average monthly tax liability of $20,000 or more, as determined in the manner provided above, shall continue until the taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until the taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $20,000. If, however, a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred that causes the taxpayer to anticipate that his or her average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then the taxpayer may petition the Department for a change in the taxpayer's reporting status. The Department shall change the taxpayer's reporting status unless it finds that the change is seasonal in nature and not likely to be long-term. If any quarter-monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer is liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of the quarter-monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter-monthly payment amount and quarter-monthly payment dates for taxpayers who file on other than a calendar monthly basis.

A supplier may make tax-free sales of special fuel, with respect to which he is otherwise required to collect the tax, when the motor fuel is delivered from a dispensing facility that has withdrawal facilities capable of dispensing special fuel into the fuel supply tanks of motor vehicles only as specified in the following items 1, 2, and 3. A supplier may make tax-free sales of special fuel, with respect to which he is otherwise required to collect the tax, when the special fuel is delivered from other facilities only as specified in the following items 1 through 7.

1. When the sale is made to the federal government or its instrumentalities.

2. When the sale is made to a municipal corporation owning and operating a local transportation system for public service in this State when an official certificate of exemption is obtained in lieu of the tax.

3. When the sale is made to a privately owned public utility owning and operating 2 axle vehicles designed and used for transporting more than 7 passengers, which vehicles are used as common carriers in general transportation of passengers, are not devoted to any specialized purpose and are operated entirely within the territorial limits of a single municipality or of any group of contiguous municipalities, or in a close radius thereof, and the operations of which are subject to the regulations of the Illinois Commerce Commission, when an official certificate of exemption is obtained in lieu of the tax.

4. When a sale of special fuel is made to a person holding a valid unrevoked license as a supplier or a distributor by making a specific notation thereof on invoice or sales slip covering each such sale.

5. When a sale of special fuel is made to someone other than a licensed distributor or licensed supplier for a use other than in motor vehicles, by making a specific notation thereof on the invoice or sales slip covering such sale and obtaining such supporting documentation as may be required by the Department. The supplier shall obtain and keep the supporting documentation in such form as the Department may require by rule.

6. (Blank).

7. When a sale of special fuel is made to a person where delivery is made outside of this State.

All special fuel sold or used for non-highway purposes must have a dye added in accordance with Section 4d of this Law.

All suits or other proceedings brought for the purpose of recovering any taxes, interest or penalties due the State of Illinois under this Act may be maintained in the name of the Department.

(Source: P.A. 92-30, eff. 7-1-01; 93-32, eff. 6-20-03.)

Section 10. The Environmental Impact Fee Law is amended by changing Section 315 as follows:

(415 ILCS 125/315)

(Section scheduled to be repealed on January 1, 2013)

Sec. 315. Fee on receivers of fuel for sale or use; collection and reporting. Except as otherwise provided in this Section, a A person that is required to pay the fee imposed by this Law shall pay the fee to the Department by return showing all fuel purchased, acquired, or received and sold, distributed or used during the preceding calendar month, including losses of fuel as the result of evaporation or shrinkage due to temperature variations, and such other reasonable information as the Department may require. Losses of fuel as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of the month, plus the receipts of gallonage during the month, minus the gallonage remaining in storage at the end of the month. Any loss reported that is in excess of this amount shall be subject to the fee imposed by Section 310 of this Law. On and after July 1, 2001, for each 6-month period January through June, net losses of fuel (for each category of fuel that is required to be reported on a return) as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of each January, plus the receipts of gallonage each January through June, minus the gallonage remaining in storage at the end of each June. On and after July 1, 2001, for each 6-month period July through December, net losses of fuel (for each category of fuel that is required to be reported on a return) as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of each July, plus the receipts of gallonage each July through December, minus the gallonage remaining in storage at the end of each December. Any net loss reported that is in excess of this amount shall be subject to the fee imposed by Section 310 of this Law. For purposes of this Section, "net loss" means the number of gallons gained through temperature variations minus the number of gallons lost through temperature variations or evaporation for each of the respective 6-month periods.

The return shall be prescribed by the Department and shall be filed between the 1st and 20th days of each calendar month.

On and after July 1, 2007, if the receiver's average monthly liability to the Department for the aggregate of the tax imposed under Section 2a of the Motor Fuel Tax Law and the fee imposed under Section 315 of this Law was $20,000 or more during the preceding 4 complete calendar quarters, then the receiver shall file a return with the Department each month by the 20th day of the month next following the month during which the liability is incurred and shall make payments to the Department on or before the 7th, 15th, 22nd, and last day of the month during which the liability is incurred. Each payment shall be in an amount equal to 22.5% of the receiver's actual liability for the month or 25% of the receiver's liability for the same calendar month of the preceding year. The amount of the quarter-monthly payments shall be credited against the final liability of the receiver's return for that month filed under this Section. Once applicable, the requirement of the making of quarter-monthly payments to the Department by receivers having an average monthly liability of $20,000 or more, as determined in the manner provided above, shall continue until the receiver's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until the receiver's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period, is less than $20,000. If, however, a receiver can show the Department that a substantial change in the receiver's business has occurred that causes the receiver to anticipate that his or her average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then the receiver may petition the Department for a change in the receiver's reporting status. The Department shall change the receiver's reporting status unless it finds that the change is seasonal in nature and not likely to be long-term. If any quarter-monthly payment is not paid at the time or in the amount required by this Section, then the receiver is liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of the quarter-monthly payment actually and timely paid, except insofar as the receiver has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter-monthly payment amount and quarter-monthly payment dates for receivers who file on other than a calendar monthly basis.

The Department may, in its discretion, combine the return filed under this Law with the return filed under Section 2b of the Motor Fuel Tax Law. If the return is timely filed, the receiver may take a discount of 2% through June 30, 2003 and 1.75% thereafter to reimburse himself for the expenses incurred in keeping records, preparing and filing returns, collecting and remitting the fee, and supplying data to the Department on request. Except as otherwise provided in this Section, however However, the discount applies only to the amount of the fee payment that accompanies a return that is timely filed in accordance with this Section.

(Source: P.A. 92-30, eff. 7-1-01; 93-32, eff. 6-20-03.)

Section 99. Effective date. This Act takes effect upon becoming law.